Austan Goolsbee, the 26th Chairman of the Council of Economic Advisers in the Obama Administration and Professor of Economics at University of Chicago, met with President Obama in California to discuss Obama’s recent budget proposals. Goolsbee explained the President’s policies on a live stream aimed to attract college students. He focused on the effect these budget cuts would have on the American public, most specifically the college-aged generation. He then took calls from college students and answered their questions to discuss why young Americans should be concerned about the budget and the national deficit.
First, Goolsbee highlighted what he considered the three most important aspects of Obama’s plan. Firstly, round tables are important to generate new ideas so we must encourage people to brainstorm and foster plans for the future. Secondly, under a fiscally responsible plan, while we are living within our means, some aspects of society need to be protected and are too important to cut the budgets for. Thirdly, a clear plan to live responsibly within our means will stop us from mortgaging the future and passing on our debt to future generations.
There are two ways to mortgage the future. “You can leave bills to the next generation to pay or you cannot make key investments in their education, infrastructure, training — investment in industries of future,” he said.
With regards to investing in the future, the aforementioned round tables help Obama identify the aspects of American life that are too crucial to be cut and need to be protected. “Education, innovation and investment are the three areas we can’t afford to sacrifice,” Goolsbee said. When asked by a calling-in student how the budget would affect young people, he focused on education. “We must invest in educating young people,” he said. “If there are large cuts to discretionary spending, there will be significant direct cuts to education spending for college students, graduate students and even for K-12 schools.”
He further explained that if Obama cuts the $9 million of financial aid in the middle of the year, the majority of those students will have to drop out of school. In the long run, there will be substantially less economic activity for America. This will cause the government to have less money because these dropouts will make less money and pay fewer taxes. Additionally, he explained that we must invest in clean energy and continue research and development in this field. This innovation and investment will benefit us in the long run as well. He predicts this industry will offer many jobs and profits in the future, so Obama is trying to nourish this growing industry now. “We are simply protecting our priorities,” Goolsbee said.
The third aspect of Obama’s plan addresses his goal for us to live responsibly within our means by creating a new budget. “Obama will cut discretionary spending to a level that hasn’t been reach since Eisenhower’s presidency,” Goolsbee said. Obama has a $4 trillion deficit reduction plan over the next 10-12 years. This plan will preserve the President’s aforementioned priorities, such as education, while cutting out entitlement, defense and discretionary funds and making the high income tax rates what they were under President Clinton. In response to a student question, Goolsbee explained how Obama tried to balance the interests of the Republicans, who want to make budget cuts, and the Democrats, who want to use government programs to stimulate the economy. He responded that the President has appeal to a middle ground in his deficit reduction program. “He made sure not to cut anything that would undermine the future agenda and existence of basic social combat in the nation,” Goolsbee said.
As an example, Goolsbee explained that the government isn’t going to abolish Medicare and turn senior citizens over to private insurance companies. At the same time, he also explained that Obama could not please the Republicans’ desire for high income tax cuts because this will add another $2 trillion to our deficit, making it a total of $6 trillion. “This will reduce significantly the burden on young people what they will be paying over the next 30 years,” he said.
Goolsbee’s description of Obama’s plan was a clear and concise explanation that broke down Obama’s ideas into simpler terms. “It was nice to have someone explain politics in a clear way because I did not feel like I was being tricked or sold anything,” freshman Kara Deppe said. His question and answer section was also a nice clarifying technique for some of the more complicated issues. “I listened to a recorded version of the live stream. I wish I had listened live so I could have called in and asked questions. That seems like such a good feature and really made the whole experience personal and catered to the individual student listener,” Deppe said.
